US Senate Passes Bill That Seeks to Exclude Chinese Companies from American Bourses for “Cheating”

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The US Senate has just passed a new bill that could exclude a number of Chinese companies from pursuing IPO’s on American bourses for failure to abide by local securities and auditing laws.

The bill requires that companies hoping to list on US exchanges establish that “they are not owned or controlled by a foreign government.”

The new legislation also requires that foreign companies they submit audits for scrutiny by the Public Company Accounting Oversight Board, which is responsible for reviewing audits of all US public companies.

Companies that fail to provide such information for three consecutive years will face the prospect of delisting of their shares from US exchanges.

The legislation passed without objection, and received the support of lawmakers from both sides of the aisle.

Senator John Kennedy, a Louisiana Republican and one of the sponsors of the bill, said the legislation was directed at China, and had the goal of “[stopping] them from cheating.”

“China is on a glide path to dominance and is cheating at every turn,” ,” said Kennedy.

“It’s asinine that we’re giving Chinese companies the opportunity to exploit hard-working Americans – people who put their retirement and college savings in our exchanges.

“There are plenty of markets all over the world open to cheaters, but America can’t afford to be one of them.”

The bill still needs to pass the House of Representatives before President Donald Trump can sign it into law.

The American Securities Association, a trade group that represents the interests of small and regional financial services firms, gave its support to the legislation.

“For far too long, fraudulent Chinese companies have gotten a free pass to access US markets and exploit American investors,” said the Association.

Sources recently said to Nasdaq that the exchange plans to introduce new rules that would curb the number of smaller Chinese companies pursuing IPO’s, by setting a minimum fund-raising sum of USD$25 million.

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